FTSE flat; UK Q4 GDP final reading marginally better; Wolseley leads on dividend reinstatement

<p>The FTSE 100 traded flat on Tuesday having started the session mildly in positive territory whilst traders showed mild enthusiasm for the final reading of […]</p>

The FTSE 100 traded flat on Tuesday having started the session mildly in positive territory whilst traders showed mild enthusiasm for the final reading of UK GDP which showed that the contraction narrowed from 0.6% to 0.5%.

The FTSE 100 looks to be in consolidation mode, having charged 4% higher last week, with the UK Index lacking much upward drive over the last two trading sessions. This is only natural having rallied so quickly last week and particularly in the context of a heavy calendar of economic data due out this week. Traders could be waiting to see which way the wind blows in terms of economic data before deciding upon their next move.

From an earnings perspective there has been much for investors to get their teeth stuck into today, with firms such as Wolseley, Thomas Cook, Kazakhmys and Man Group all reporting.

It is shares in Wolseley that have led today after the UK house builder reinstated its dividend and reported a 64% rise in profits to £275 million for the first half of the year to the end of January. Shareholders have reacted with positivity to the reinstatement of the dividend, helping to lift the firm’s shares over 2% to the top of the FTSE 100 leader board.

Italian banks have lagged wider European trade however, after UBI Banca surprised investors by announcing a €1 billion capital hike to boost its Tier 1 capital ratio ahead of European stress tests. The move has taken shareholders by some surprise and heightened concerns that this could be the start of further cash calls by other European banks.

Join our live webinars for the latest analysis and trading ideas. Register now

GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.